Co-op, condo owners left in the lurch

City co-op and condo owners were dealt a major blow by the State Legislature after lawmakers wrapped up the year’s session without passing three key bills, including one that would put a halt to skyrocketing property tax valuations.

“Three strikes and you’re out. This was a disastrous session if you’re a co-op or condo owner,” said Bob Friedrich, president of Glen Oaks Village Owners, Inc. and cofounder of the President’s Co-op and Condo Council. “The State Legislature left us high and dry.”

State lawmakers had until June 21 to give bills the green light before reconvening next January. Governor Andrew Cuomo said the 2012 session was “one of the most successful in modern political history,” touting accomplishments reached in pension tiers, teacher evaluations and better protections for people with disabilities.

But co-op and condo community activists said legislative leaders adjourned the session without extending the city’s J-51 program, its tax abatement program and not resolving valuation issues. The lack of passage could rip holes through 360,000 residents’ pockets, they said.

“These three issues are not sensitive, political issues. It’s not controversial. It’s simply renewing existing laws that already have widespread support,” Friedrich said. “And yet the legislators, who are paid very well to do their job, came out empty handed.”

The city’s J-51 Program, in existence for decades, gave owners partial property tax exemptions to encourage them to renovate residential apartment buildings, while its property tax abatement program, established in 1996, reduced the difference in property taxes paid by Class 2 co-op and condo properties and one, two and three family homes in Class 1 — which are assessed at a lower percentage of market value.

Friedrich, who expected the abatement to be extended, said if a special session is not called this year to renew the program, Glen Oaks Village alone would lose out on about $1 million, which he said would eventually come out of shareholders’ wallets.

Warren Schreiber, president of the Bay Terrace Community Alliance and cofounder of the President’s Co-op and Condo Council, predicted similar revenue losses — which he said would lead to 17 to 25 percent maintenance increases for residents.

“We were all terribly disappointed. These were programs that we already had,” he said. “This will be economically devastating for some residents.”

According to a summary report released by the Department of Finance (DOF) this year, taxes are expected to rise by 7.5 percent for co-op owners and 9.6 percent for condo owners across the city, while owners of single-family homes will see an increase of 2.8 percent. Last year, officials said, some co-op and condo valuations saw astronomical increases as high as 147 percent.

A pair of audits released this year by the city’s comptroller office found the DOF at fault for causing upheavals in condo and co-op property values — a determining factor in property taxes — when it changed its formula for calculating them in Fiscal Year 2011-12.

A “8/30” cap proposed to relieve co-op and condo owners would have limited property tax increases to 8 percent per year or 30 percent over five years, but President’s Co-op and Condo Council officials said they do not expect a fix to be made for another year.

Meanwhile, rumors have been swarming that Cuomo will call lawmakers back to Albany for a special session before the year’s end, reportedly to approve the tax abatement extension.

Councilmember Mark Weprin said “for a fact” the abatement would be renewed and “improved” this year in the fall under Assemblymember Ed Brauinstein’s bill and an agreement with the state.

“It’s not a ‘major blow.’ Once it’s passed, it’ll be a huge victory,” Weprin said.

Despite the unofficial pledge, State Senator Tony Avella and Assemblymembers David Weprin and Mike Simanowitz announced they would be holding a press conference on Monday to rally for the abatement renewal.